Company Number: 13393230

Analysis Date: 2025-07-29 20:42 UTC

1. Credit Opinion: CONDITIONAL APPROVAL
   AGI Global Logistics (LHR) Limited is an active small private limited company operating in the freight air transport sector. The company shows evidence of increasing scale, with debtors rising from £503k to £750k and current assets growing accordingly. However, it reported net current liabilities of £108k and negative shareholders’ funds of £106k as of 31 March 2024, reflecting a weak liquidity position and balance sheet erosion. The company relies significantly on group transactions and director advances, which may mask underlying cash flow stresses. The frequent director turnover within the last two years adds some governance uncertainty. Given these factors, credit approval should be conditional upon monitoring liquidity improvements and clarification on group support and intercompany balances.

2. Financial Strength:
   The balance sheet reveals tangible fixed assets of only £2.6k, indicating minimal long-term investment. Current liabilities (£905k) exceed current assets (£796k), producing a net working capital deficit of £108k. This is a deterioration from prior periods when net current assets were positive but modest. Shareholders’ funds moved from positive £18k (Nov 2022) to negative £106k (Mar 2024), showing accumulated losses or capital erosion. The company holds no significant cash reserves, with only £46k in cash. The reliance on amounts owed by and to group companies (£187k owed by group, £257k owed to group) implies financial interdependence within the group structure. Overall, the financial strength is weak with a fragile equity base and poor liquidity coverage.

3. Cash Flow Assessment:
   Cash at bank is low at £45.8k against current liabilities of £905k, highlighting potential short-term liquidity constraints. Trade debtors have increased substantially, which may strain cash flow if collection periods are extended. The company operates interest-free director loan accounts (£57k owed by directors), suggesting informal financing arrangements. Operating leases commitments total £66.6k over the next five years, adding fixed costs. The net current liability position and high trade creditor balances (£357k) suggest a tight working capital cycle. Without timely collection of receivables or external support, the company may face cash flow difficulties servicing short-term obligations.

4. Monitoring Points:

• Liquidity improvement, especially reduction in net current liability and increase in cash reserves.
• Collection period for trade debtors and ageing analysis to assess cash flow risk.
• Stability in director and management appointments to ensure consistent governance.
• Group related party balances and any financial support or guarantees provided by the parent or group entities.
• Profitability trends and movement in retained earnings to gauge recovery or further decline.
• Lease obligations and their impact on fixed overheads.